$10 Billion to $1 in Zimbabwe
By David J. Theroux • Thursday July 31, 2008 11:17 AM PDT • 5 Comments
To follow up on my recent posting regarding the funding of oppression in Zimbabwe through hyperinflation, Zimbabwean Central Bank Governor Gideon Gono has announced that after issuing $100 billion notes (not yet enough to buy even a loaf of bread), the government is devaluing its currency by dropping 10 zeroes, converting 10 billion dollars into one. AP reports (see here and here) that:
President Robert Mugabe threatened a state of emergency if businesses profiteer from the country’s economic crisis . . . . “Entrepreneurs across the board, don’t drive us further,” Mugagbe warned in a nationally televised address after the currency announcement. “If you drive us even more, we will impose emergency measures. . . . They can be tough rules.”
Of course, this massive currency devaluation will have no effect whatever on the escalating hyperinflation. As AP notes:
Inflation, the highest in the world, is officially running at 2.2 million percent in Zimbabwe, but independent economists say it is closer to 12.5 million percent.
Economist John Robertson said the new bills will soon be worthless, because the inflation rate continues to skyrocket.
Our newest book, Good Money by George Selgin, explains that legalizing private currency is the solution for people to protect themselves from being victimized by central banking monopolies.
Tags: Africa, Budget and Tax Policy, Economics, Money and Banking, Personal Liberty, Presidential Power 
Why is it that normally intelligent people can look at the disaster in Zimbabwe and readily conclude that Mugabe’s thuggish regime is entirely responsible for the hyper-inflation, unemployment, and empty store shelves, yet are completely clueless about our own government’s role in our own depreciating currency and looming economic meltdown?
Inflation is an increase in the money supply. Who has the ability to increase the money supply, you ask? It isn’t greedy capitalists, devious speculators, or mass insecurity on the part of the unwashed. The blame rests solely with the crooks in Washington and the politically-connected special interests that profit from monetary manipulation.
But it isn’t enough to affix blame where it belongs. It’s time that these crooks do some hard time for their crimes.
A guy can dream, can’t he?
Steve Hogan | Jul 31, 2008 | Reply
Steve,
Only the greedy capitalists, devious speculators, and Central Bank counterfeiters cause hyperinflation in EVERY known historical case. Zimbabwe is no different, every Chartalist system gets counterfeited to the point of hyperinflation. Colonial Script, Greenbacks, Assignants and Marks all this fiat/Chartalist currency gets counterfeited by, the Bank of England time and time again and this time it’s no differnt. Only a Privately held Central Bank is allowed to create money, heaven forbid governments are allowed to do so, that is why we have wars.
Rod | Aug 4, 2008 | Reply
All central banks are government-created monopolies protected by government mandates. See the book Money and the Nation State, edited by Kevin Dowd and Richard H. Timberlake.
David Theroux | Aug 10, 2008 | Reply